ARTICLES OF INCORPORATION
OF
SAN ELIJO HILLS HOMEOWNERS ASSOCIATION, INC.

The purposes for which this corporation is formed are:

(a) The specific and primary purpose is to provide management, maintenance, preservation, and control of the contiguous or noncontiguous lots, parcels, or areas owned in common by the owners of the separately owned lots, parcels, or areas in the area known as San Elijo Hills, in Solana Beach, San Diego County, State of California.

(b) The general purposes and powers are:

(1) To provide for the improvement and maintenance of public easements, grass plots, parking areas, and other facilities or areas of any kind dedicated to community use and other open spaces and ornamental features within San Elijo Hills, which now exist or which may hereafter be installed, erected, or constructed therein.

(2) To make and perform contracts of every kind and nature for any lawful purpose without limit as to amount, with any person, firm, association, corporation, municipality, state, government, or municipal or political subdivision.

(3) To receive property by gift, devise, or bequest, subject to the laws regulating the transfer of property by will, and to otherwise acquire and hold all property, real or personal, and to transfer, convey, lease or otherwise dispose of such real and personal property, and to distribute gifts of property of all kinds.

(4) To cooperate with the owners of all vacant and unimproved lots and plots now existing or which hereafter shall exist, in said San Elijo Hills in keeping them in good order and in a sightly condition, and in preventing their becoming a nuisance and a detriment to the beauty of the area and to the value of the improved property therein; and to take any action with reference to such vacant and unimproved lots and plots as may be necessary or desirable to keep them from becoming such nuisance and detriment.

(5) To aid, and cooperate with, the members of this corporation and all property owners in said subdivision in the enforcement of such conditions, covenants, and restrictions on and appurtenant to their property as shall hereafter be approved by a majority vote of the members of the corporation, and to counsel with the Planning Commission and the Supervisors of the County having jurisdiction in relation to any zoning which may affect any portion of the subject property.

(6) To arrange social and recreational functions for its members.

(7) To carry on any activity whatsoever in this State or anywhere in the world, either as principal, agent, or partner, which this corporation may deem proper or convenient in connection with any of the foregoing purposes, or which may be calculated directly or indirectly to promote the interests of this corporation.

(8) To have and exercise all the rights and powers conferred on nonprofit corporations under the General Nonprofit Corporation Law of California, as such law is now in effect or may at any time hereafter be amended.

The foregoing statement of purposes shall be construed as a statement of both purposes and powers, and the purposes and powers stated in each clause shall, except where otherwise expressed, be in no way limited or restricted by any reference to or inference from the terms or provisions of any other clause, but shall be regarded as independent purposes and powers.

(c) Notwithstanding any of the foregoing statements of purposes and powers, this corporation shall not, except to an insubstantial degree, engage in any activities or exercise any powers that are not in furtherance of the primary purposes of this corporation as set forth in Paragraph (a) of this Article SECOND.

(a) The number of Directors of this corporation shall be seven (7).

(b) The names and addresses of the persons who are to act in the capacity of Directors until the selection of their successors are:

Anthony J. Ruotolo, 1563 Santa Sabina, Solana Beach

Eleanor S. Thompson, 1463 Santa Marta, Solana Beach

Vicki J. Shea, 1320 Santa Luisa, Solana Beach

John Bennett, 550 San Mario, Solana Beach

Peter J. Nero, 1266 Santa Luisa, Solana Beach

Richard M. Hutcheson, 1455 Santa Marta, Solana Beach

Richard DeLa Cruz, 435 Santa Victoria. Solana Beach

(c) The Directors shall serve without compensation and no Director shall receive any pecuniary benefit from the corporation, except reimbursement for his actual expenses incurred in connection with the business of the corporation.

(d) The powers of this corporation shall be exercised, the property controlled, and its affairs conducted by the Board of Directors.

(e) Any action required or permitted to be taken by the Board of Directors under any provision of law may be taken without a meeting, if all members of the Board shall individually or collectively consent in writing to such action. Such written consent or consents shall be filed with the minutes of the proceedings of the Board. Such action by written consent shall have the same force and effect as the unanimous vote of such Directors. Any certificate or other document filed under any provision of law which relates to action so taken shall state that the action was taken by the unanimous written consent of the Board of Directors without a meeting and that the Articles of Incorporation authorize the Directors to so act, and such statement shall be prima facie evidence of such authority.

The property of this corporation is irrevocably dedicated to non-profit purposes as more specifically set forth in Paragraph SECOND of these Articles and no part of the net income or assets of this organization shall ever inure to the benefit of any director, officer or member thereof or to the benefit of any private individual. Upon the dissolution or winding up of the corporation, its assets remaining after payment of, or provision for payment, of all debts and liabilities of this corporation, shall be distributed to a non-profit fund, foundation or corporation which is organized and operated exclusively for non-profit purposes as more specifically set forth in Paragraph SECOND of these Articles and which has established its tax-exempt status under Section 501(c)(3) of the Internal Revenue Code of 1954. If this corporation holds any assets in trust, or a corporation is formed for charitable purposes, such assets shall be disposed of in such manner as may be directed by decree of the superior court of the county in which the corporation has its principal office, upon petition therefore by the Attorney General or by a person concerned in the liquidation, in a proceeding to which the Attorney General is a party.

Notwithstanding any other provision in these Articles of Incorporation to the contrary, the corporation shall be subject to the following limitations and restrictions:

(a) The corporation shall distribute its income for each taxable year at such time and in such manner as not to become subject to the tax on undistributed income imposed by Section 4942 of the Internal Revenue Code of 1954.

(b) The corporation shall not engage in any act of self-dealing as defined in Section 4941(d) of the Internal Revenue Code of 1954.

(c) The corporation shall not make any investments in such a manner as to subject it to tax under Section 4944 of the Internal Revenue Code of 1954.

(d) The corporation shall not retain any excess business holdings as defined in Section 4943(c) of the Internal Revenue Code of 1954.

(e) The corporation shall not make any taxable expenditures as defined in Section 4945(d) of the Internal Revenue Code of 1954.